Gas prices have increased by more than 30 percent already this year and have nearly doubled since just two years ago. If you were an average American household then you spent around $368.09 this past April. Compare that with the graph to the right on monthly gas expenditures by year and its quite clear gas is likely taking a big gulp out of your budget.
If you made about $46,000, the average salary of an American household and paid a combined 35% state and federal income tax you would have about $30,000 left for your family needs. Gas would be consuming 14.7% of your available income. That’s a lot! Just consider that your total housing is around 25% – that means you spend half as much on just gas as you do having a roof over your head. And while it might be leveling now with the recent dismal jobs report, see “Don’t Pop the Champagne Bottle Just Yet” posting, it is currently averaging $3.98 a gallon. See the cost per gallon graphic above where the darker the red your state is the closer you are getting to $5.00 per gallon!
As gas prices increase it means that the flow of your money has to change from something to gas. Unfortunately for those who are trying to save a little money for the kid’s college fund, emergency fund or savings in general they may have to reduce the level of savings. Or other things that are part of life have to be reduced or eliminated. It might mean that it is getting harder to make the payments that are keeping that roof over your head!
Do I have your attention yet? If yes, here are few things you can easily do to lower the size of that bite by as much as 25 percent…effectively getting your cost per gallon down to less than $3.00 per gallon, less than $275 per month and around 10 percent of your income.
1. The quickest and most effective thing you can do is to drive less…and that is what a lot of people are doing. They have figured out how to combine trips, not go or to do things together such as shopping combined with kids events or to do driving with more than one family, i.e. two families go grocery shopping together. Using this approach it is easily possible to lower your driving to 15% fewer miles which would lower your gas consumption generally by the same amount.
2. Be easy on the foot pedal, not just on the ulitmate speed but on the acceleration getting up to speed. The faster you take off and the more you brake to slow down the more gas you consume. And if you are doing a lot of stop and go driving in a town this can consume a lot of gas. If you are a typical “get up to speed and brake person” you can save 5% of your gas by gradually getting to speed and coasting more when have to slow down or come to a stop. With this and step 1 you have alreadysaved 20%.
3. Then there is the speed at which you drive the car. It takes more energy (gas) to go faster, in fact if you double your speed it takes 4 times the fuel, not twice as much and if you triple your speed it takes 9 times as much fuel, not 3 times as much. Driving 55 instead of 70 will increase your gas mileage by at least 20%.
4. Finally make sure your tires are aired up properly. Under inflated tires can cause a 2 to 4 percent drop in mileage or more.
Since you can’t do all of these at one time, you can’t add all the savings collectively, but a combination of the four will reduce your gas needs by 25%. And that is like lowering the cost of gas by 25%.
What ideas and methods do you have for effectively taking the bite out of your budget due to gas prices?